Buying Power: How to Fund Your First North Shore Home
Executive Summary
At a Glance: The 2024 Rules
More Cash Access: You can now withdraw up to $60,000 from your RRSP for a down payment (up from the old $35k limit).
The "New Build" Loophole: First-time buyers get a massive tax break on newly built homes up to $1.1 million, but almost zero tax relief on existing homes.
Program Sunset: The federal "Shared Equity" program (FTHBI) was cancelled earlier this year. Don't count on it.
1. The "Super Account": First Home Savings Account (FHSA)
This is the single best tool for saving money right now. It combines the best perks of an RRSP and a TFSA.
How it works: You can put in up to $8,000 per year (up to a lifetime max of $40,000).
The Double Win: When you put money in, you get a tax deduction (lowering your income tax bill). When you take money out to buy a home, it is 100% tax-free.
Analyst Note: If you are planning to buy in the next 1-5 years, fill this account before you put money anywhere else.
2. The "Interest-Free Loan": RRSP Home Buyers’ Plan
Correction Alert: Many guides still list the old $35,000 limit. The rules changed in April 2024.
The New Limit: You can now withdraw $60,000 from your RRSP tax-free to buy your first home.
Couples: If you and your partner both qualify, that is $120,000 of liquid cash you can access instantly.
The Catch: You have to pay it back to yourself over 15 years. However, new rules give you a 5-year grace period before you have to start making payments.
3. The "Tax Trap": Property Transfer Tax (PTT)
This is where most buyers get confused. The tax break you get depends entirely on what you buy.
If you buy a USED home (Resale): You only get a full tax exemption on homes under $500,000.
Reality Check: There is almost nothing on the North Shore under $500k. Expect to pay the full tax on a standard resale condo.
If you buy a BRAND NEW home (Presale): The government wants to encourage new construction, so the exemption is much higher. You pay $0 tax on new homes up to $1,100,000.
The Strategy: If you are buying your first place and your budget is around $900k - $1M, buying a brand new unit could save you roughly $18,000 - $20,000 in taxes compared to buying an older unit.
4. The "Cancelled" Program: FTHBI
You might see old articles mentioning the "First-Time Home Buyer Incentive" (where the government helped with your down payment in exchange for owning part of your home).
Status Update: This program was discontinued in March 2024. It is no longer an option, so don't include it in your budget planning.
Let’s Run Your Numbers
The rules are better than they used to be, but they are specific. If you want to see exactly how much spending power you have with these new limits, reply to this email. I can help you map out a "Liquidity Plan" to see what you can afford on the North Shore today.
About Matt Council
Matt Council is a top-performing North Vancouver Realtor and West Van specialist with a background in finance. He moves beyond the sales hype to offer clients a data-driven, pressure-free approach to buying and selling real estate on the North Shore. Whether you are evaluating a presale in Lower Lonsdale or a detached home in Lynn Valley, Matt helps you understand the numbers behind the move.
Thinking of making a move? Let’s run the numbers.